1989 (4) TMI 315 - SC - Indian Laws

Whether the action of the respondent in evicting the appellant and granting the premises in question to M/s Dhanji Mavji was proper and right? Held that - Appeal dismissed. As we look upon the facts of this case, there was an implied obligation in respect of dealings with the tenants/occupants of the Port Trust authority to act in public interest/purpose - That requirement is fulfilled if it is demonstrated that the Port Trust Authorities have acted in pursuance of a policy which is referable to public purpose. Once that norm is established whether that policy is the best policy or whether another policy was possible, is not relevant for consideration. It is, therefore, not necessary for our present purposes to dwell on the question whether the obligation of the Port Trust Authorities to act in pursuance of a public purpose was of public law purpose or a private law purpose. Under the Constitutional scheme of this country the Port Trust Authorities were required by relevant law to act in pursuance of public purpose.

Issues Involved:
1. Judicial review of the action of a statutory authority.
2. Validity of eviction notice and waiver.
3. Public law character of the statutory authority's actions.
4. Allegations of arbitrariness and discrimination in eviction.
5. Policy and public interest considerations in eviction.

Detailed Analysis:

1. Judicial Review of the Action of a Statutory Authority:
The Supreme Court was asked to examine the frontiers of judicial review concerning the actions of the Board of Trustees of the Port of Bombay in evicting its tenant and granting the land to another tenant. The Court acknowledged that the respondent, being a statutory authority, was exempt from the Rent Act and had to act in public interest, not like ordinary landlords. The Court emphasized that public authorities must act for public benefit and such actions are subject to judicial review to ensure they are not arbitrary or unreasonable.

2. Validity of Eviction Notice and Waiver:
The High Court upheld the appellate court's finding that the notice of ejectment was valid and there was no waiver of notice. The Supreme Court agreed that under Article 227 of the Constitution, the High Court could not have re-appraised this question, and similarly, the Supreme Court in an appeal under Article 136 could not re-appraise it either.

3. Public Law Character of the Statutory Authority's Actions:
The appellant contended that the respondent's actions, being a 'State' within Article 12 of the Constitution, were subject to Article 14 and must be reasonable and in public interest. The Court reiterated that public authorities must act in accordance with public interest and any infraction is subject to judicial review. The Court noted that the exemption from the Rent Act was based on the assumption that the Port Trust would act in public interest and not like private landlords.

4. Allegations of Arbitrariness and Discrimination in Eviction:
The appellant argued that the eviction was arbitrary and discriminatory, deviating from the established policy of offering plots to existing tenants as joint tenants. The Court acknowledged that governmental policy or action, even in contractual matters, must satisfy the test of reasonableness and public interest. The Court found no evidence of mala fide in the eviction proceedings. The Court held that the Port Trust's decision to allot the entire plot to the major occupant (M/s Dhanji Mavji) was not arbitrary or discriminatory but was a policy decision aimed at proper development, which could not be faulted.

5. Policy and Public Interest Considerations in Eviction:
The Court noted that the Port Trust's policy was to allot reconstituted plots to major occupants for development. The Court found that the policy was reasonable and aimed at compliance with the Town Planning Scheme. The Court observed that joint development required cooperation, which was not feasible in this case. The Court concluded that the Port Trust acted reasonably and in adherence to a policy serving public purpose, thus affirming the High Court's decision.

Conclusion:
The Supreme Court dismissed the appeal, affirming that the actions of the Port Trust were in public interest and not arbitrary or discriminatory. The Court emphasized the necessity for public authorities to act reasonably and in public interest, subject to judicial review. The Court also noted that the Port Trust would consider granting an alternative site to the appellant if applied for.

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